Romney, who met Sunday with President Shimon Peres
and Prime Minister Benjamin Netanyahu,
declared Jerusalem to be the capital of the Jewish state; and said that should he be elected, the US Embassy in Israel
would be relocated from Tel Aviv to Jerusalem.

Erekat said Romney's comments are "disturbing," reward "occupation and aggression" and go against long-standing US policy.

Another comment by Romney, this time concerning the Israeli and Palestinian
economies, also enraged the Palestinian Authority.

"As you come here and you see the GDP per capita, for instance, in Israel which is about $21,000 dollars, and compare that with the GDP per capita just across the areas managed by the Palestinian Authority, which is more like $10,000 per capita, you notice such a dramatically stark difference in economic vitality,"
the Republican presidential candidate said.

"It is a racist statement and this man doesn't realize that the Palestinian economy cannot reach its potential because there is an Israeli occupation," Erekat said.

"It seems to me this man (Romney) lacks information, knowledge, vision and understanding of this region and its people," he added. "He also lacks knowledge about the Israelis themselves. I have not heard any Israeli official speak about cultural superiority."

"His comments were grossly mischaracterized," Romney campaign spokeswoman Andrea Saul said later. The campaign contends that Romney's comparison of other neighboring countries with income disparities, including the US and Mexico, shows his comments were broader than just the comparison between Israel and Palestine.

Romney told donors that he had read books and relied on his business experience to understand why the economic difference is so great.

"And as I come here and I look out over this city and consider the accomplishments of the people of this nation, I recognize the power of at least culture and a few other things," Romney said, citing an innovative business climate, the Jewish history of thriving in difficult circumstances and the "hand of providence."